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NEWARK
– Consumers who bought memberships
in a Hoboken health club that closed in
September will be able to file claims for
refunds, under terms of a Consent Order
between the Division of the Consumer Affairs
and the owners of the health club.
Empire
Fitness of Hoboken, formerly located at
605 Washington Street in Hoboken, operated
without being registered with the Division
of Consumer Affairs as legally required.
"This
is an important consent order which helps
customers of a now shuttered health club,''
Attorney General Anne Milgram said. "But
it is also an important reminder that consumers
should always check with the Division of
Consumers Affairs before joining a private
gym and they should read proposed contracts
carefully before signing on the dotted line
There should be specific provisions protecting
consumers in the event the club shuts down."
“The
post-holiday period is a time when consumers
typically join health clubs,” said
David Szuchman, Consumer Affairs Director.
“Before they work out, consumers need
to do their homework and make sure the health
club they are thinking of joining is registered
with the Division of Consumer Affairs.”
Registration
requirements include the posting of a surety
bond, which is an asset that is available
for consumer refunds in the event a health
club closes or goes out of business. Surety
bonds are required when membership contracts
longer than three months are sold to consumers.
Contracts between the health club and consumers
also must contain specific language informing
consumers of their rights.
T.J.B.,
Inc., which did business as Empire Fitness
of Hoboken, and Lucille Caputo, the owner
of the health club, agreed to provide the
Division of Consumer Affairs with the club’s
membership list and other records to identify
the consumers entitled to refunds. The Division
will inform each consumer of his/her right
to file a claim for a refund and then review
all submitted claims.
T.J.B., Inc., and Caputo also agreed to
pay the Division $10,000 in civil penalties,
$667 as reimbursement for its investigative
costs and $405 as reimbursement for its
legal fees. They also agreed to comply with
the state’s Consumer Fraud Act, Health
Club Provisions and Health Club Regulations
in any future operation of a health club.
Szuchman
noted that consumers can check whether a
health club is registered by contacting
the Division’s Regulated Business
Section at 973-504-6261. Consumers also
can ask health club representatives to see
the facility’s state-issued registration
document.
Health
club operators are required to:
- Issue
written contracts and
provide a copy of the executed contract
to the consumer;
- List
the consumer’s total payment obligation
on the first page of the contract;
- Include
a ‘Notice to Customer’ within
the contract informing
the consumer of his/her right to cancel
the contract within three days after receiving
a copy of the contract;
- Extend
the contract for a period equal to a 30-day
or longer closure of the health club or
provide a prorated refund to the consumer;
and
- Allow
cancellation of the contract
by the consumer and provide a prorated
refund if the consumer moves more than
25 miles from the health club or an affiliated
health club offering the same or similar
services, at no additional expense to
the consumer.
To
file a complaint, contact the Division via
its web site, www.nj.gov/oag/ca/ocp/ocpform.htm
or call 1-800-242-5846
(toll-free within N.J.) or 973-504-6200.
Deputy
Attorney General Jah-Juin Ho represented
the state in this matter.
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